Ella 
We were wrong yesterday that Aussie would consolidate between 0.6380/0.6430. Contrary to range-bound trading, the Aussie rose to 0.6455 before retreating. Although it rose to 0.6455, the upward momentum did not increase significantly, and the Australian dollar is not expected to rise further. Today we still expect the Australian dollar to trade in a range between 0.6400-0.6450.
Outlook for the next 1-3 weeks: Our view has not changed since Monday (Aug 21 at 0.6420). As we have highlighted, although the Aussie’s downtrend that started late last month is still intact, short-term conditions are severely oversold and further declines may slow down. For the Aussie to fall further, it must break and hold below last week’s low of 0.6365. As long as it holds below 0.6480 (‘strong resistance’ level unchanged), chances remain for the Aussie to fall significantly below 0.6365. Looking ahead, the next support below 0.6365 is at 0.6320.
